College is all about growing up, coming into your own and learning how to be independent and take care of yourself. An important thing about being an adult is learning how to manage your money, spending it wisely, budgeting and learning how to distinguish between “wants” and “needs.” Combine both of these daunting tasks and you are left with a very confused and helpless college student just trying to make it in the world. Read on to learn some tips and tricks for banking smartly as a student and forgetting about the stressors that money sometimes brings and even making them unavoidable.
Set a Weekly Budget For Yourself
I know this can be a difficult habit to live by and seems kind of silly but it is a smart move for establishing some discipline in your life and learning how to control your spending when living on your own. You should make a list of all the things you would need in a month like food, toiletries, books or anything school related and then some things to splurge on like going out to eat, clothes or alcohol, etc. If you set a weekly budget based on a balance between your needs and wants, you will not overspend and be able to put away some of your money toward a savings account. Assess your income, if you have one, or the allowance from your parents and determine what the best budget is based on these factors. It may take some adjusting throughout the year but establishing a reasonable budget at the start of the semester will take off the stress of running out of money halfway through the year.
Do Your Research on Local Banks
Before you decide to settle down somewhere do your research on the local banks in the area to figure out which one is best for you in your area. Check to see what the interest rate is on the bank, how many there are in the area to know if you will have quick access to your money and if the people are helpful in answering your money questions like depositing checks or, for example, opening a savings account or 401(k) account. The whole concept of spending and saving money for the future can be a lot to grasp for a student so find a bank where you trust people and know you will always be helped.
Open a Savings Account
As mentioned above, opening a savings account is a very responsible thing to do as a student because many kids are not on this same track or even thinking about the far future. Dedicate a little from 15-20% of your paycheck each time to a savings account so that you can plan for events in the future, save up for something expensive that you really need or want, or invest in your future like for graduate school, a nice apartment in the city or a new car. Opening a savings account also teaches you how to spread out your money over time and make it last longer. It will also serve as an emergency fund if need be.
Earn a Solid Credit Score
As a student, a smart decision to make would be opening up a credit card account in addition to your debit card. This is a smart move for a number of reasons. For one, it will give you access to some quick money if you are in a bind or waiting for your next paycheck. Another reason why getting a credit card is smart as a young person is because it will allow you to build credit from a young age which will make people more inclined to offer you a loan knowing that you have paid your credit card bill on time. By the time you want to buy a house for you and your family or invest in a new car, you will be all set to taking out that mortgage or loan. A solid credit score is somewhere around the 700 range out on a 900 scale.
Download Apps to Check Your Stats
Another quick and easy way to manage your money and track your spending is to download your bank’s app on your smartphone. As a student, you are probably on your phone all the time anyways and are used to the instant gratification that apps and social media offers you 24/7. Many banks like Chase have apps that show you each transaction you make and where. It will tell you your checking account balance and savings account balance. These types of apps will also tell you your weekly spending average, how much you SHOULD be spending in a week, among other useful insights.
Look Out For Scholarships and Grants
A common mistake that many college students make is taking out too many student loans when there are many scholarships to be taken and loan money out there. Taking out too many student loans, more than you need, will put you in a bad financial position when you are older and trying to pay these off with the interest that has been collecting. So, do yourself a favor and research federal loans or loans from other places and scholarships that may be able to alleviate some of the financial pressure of college.
As a student you are at a disadvantage when it comes to banking because of your young age and little experience but putting these above tips into practice will put you at an advantage against the people who have not made good habits early on. The earlier you get comfortable with banking such as depositing and extracting money, learning how to manage your accounts and saving your money, the more responsible you will be with your money throughout your life. Never think to look for a little help as well, as college is a very expensive venture, so look into those loans and scholarships. In essence, spend smart and continue to learn how you can use your money wisely.